If you're in the process of purchasing a property in Auckland, chances are you've come across the term 'Land Information Memorandum' or 'LIM'. Obtaining a LIM is a crucial step for prospective property buyers, providing vital information about zoning regulations, building and resource consents, hazards, and services.
While you can order a LIM report directly from your local council for approximately $400, it's worth noting that this process typically takes about 10 working days, unless you pay more to receive it urgently. Given that many real estate agents offer LIMs at no cost, it can be tempting to rely on their convenient provision. However, it's crucial to be aware of the potential limitations that may come with relying on an agent-provided LIM.
Most real estate agents will provide a LIM to interested buyers, but it's crucial to note that they often include a disclaimer stating that they do not accept responsibility for any errors or omissions in the document. While this disclaimer may not protect an agent who knowingly distributes a deliberately altered LIM, it can be used as a defence if pages are missing due to carelessness.
Auckland Council issues its own disclaimer on LIMs, emphasizing that the document is prepared for the applicant under specific legal provisions and is only valid as of the date of issue. The council explicitly disclaims liability to anyone other than the person who applied for and paid for the LIM.
It's important to be aware that many LIMs provided by agents may be up to a month old by the time the buyer receives a copy. In a dynamic property market like Auckland, a lot can change within a month, potentially rendering certain information outdated.
If you're purchasing under the standard Agreement for Sale and Purchase of Real Estate, you have the option to tick the LIM Condition clause. This allows you two weeks to obtain your own LIM directly from the council. While this incurs an additional cost of around $400, it provides you with the most current and accurate information.
For those participating in auctions, it's important to remember that bids are typically unconditional. Therefore, it's advisable to obtain your own LIM prior to the auction to make an informed decision. While this may seem costly if you don't secure the property, it's a crucial step in ensuring you have the most up-to-date information at your disposal.
When you receive your LIM, take the time to thoroughly review it. These documents can be extensive, often spanning 30 to 40 pages. Pay close attention to Building Consents, Resource Consents, Hazards, Services Maps, and especially the drainage map for "overland flow paths." While seeking expert advice from a lawyer, planner, or civil engineer can incur additional costs, it can be invaluable in making an informed decision about the property.
Remember, investing in due diligence now can save you from potential headaches down the line.
If you would like to discuss how we can help you with the process of purchasing a property, please contact: Matthew Tetley-Jones (Consultant)
© McVeagh Fleming 2023
This article is published for general information purposes only. Legal content in this article is necessarily of a general nature and should not be relied upon as legal advice. If you require specific legal advice in respect of any legal issue, you should always engage a lawyer to provide that advice.